The Texas Building Owners and Managers Association (BOMA), an organization that represents the interest of owners and managers of commercial real estate in Texas, announced it has launched a statewide initiative advocating for Texas property appraisal reform, “Taxed Out of Town.”
“Taxed Out of Town’s” purpose is to urge Texans to contact their state legislator to demand action for fair and uniform property appraisal reform.
According to the “Taxed Out of Town” website, unpredictable and uncontrolled valuation increases have placed significant financial burdens on Texas businesses, forcing some to move outside of their respective city limits to avoid erratic appraisals.
“This issue affects everyone. … Commercial property taxes are paid by the businesses that lease space in Texas,” Houston BOMA Executive Vice President and Chief Operating Officer Tammy Betancourt said. “Higher commercial property taxes lead to increased operating costs for Texas business owners, rents for tenants, and costs for goods and services.”
In some areas of Houston, property valuations have increased more than 100 percent in the last two years, according to BOMA. In 2013, commercial property valuations across Houston increased 53 percent on average, then another 18 percent in 2014. Similar double-digit increases have occurred in other Texas cities and counties, without proportionate reductions in tax rates.
The Texas Constitution requires equal and uniform taxation, but commercial property valuations have proved to be inconsistent and lacking in a standard formula, with similar properties in the same neighborhood receiving varying appraisals. As a result, it’s difficult for Texas small businesses to accurately plan for the future, BOMA states.
“Texas takes pride in being pro-business, but the current property appraisal process is anything but,” Betancourt said. “If runaway increases in commercial property valuations are allowed to continue to burden Texas’ businesses, the end result will be stalled local growth, decreased job creation, and local businesses and investors looking elsewhere to do business.”
Texas property appraisal reform and tax relief are expected to be key issues in the 84th Texas legislative session, which begins Jan. 13. “Taxed Out of Town’s” objective is to work with legislators to identify property appraisal solutions that will improve the process and keep businesses growing.
“Our great state’s continued economic growth and prosperity means little if our local businesses cannot afford to grow along with it,” Betancourt said. “Texans deserve meaningful property appraisal reform.”